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Clark said if and when the border opens to older animals more cattle will be shipped south to the U.S. for slaughter as a result of the new regulations.
Another case of the differing laws of the two countries and NAFTA negatively impacting the cattle producers of both countries- usually at the benefit of the multinational Corporations...
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New SRM rules pressure prices on older animals;
The new rules, which will effectively ban this material, will go into effect in July. But the rendering and processing sectors are already reacting.
BY PATRICK GALLAGHER, ONTARIO FARMER STAFF
May 15, 2007
via Meat & Poultry
The fallout from the new ban on specified risk material from cattle older than 30-months in the animal food chain is already having an impact on the price of those animals.
Cargill Meat Solutions, which owns the Better Beef meat processing plant in Guelph, was the first off the mark in announcing its discount for over 30-month cattle would double to $40 per CWT on a carcass of beef.
In a recent note to cattle feeders the company said the discount was necessary because SRM material from older animals now has to be segregated from other rendering materials.
Cargill even went further, advising producers it "would prefer not slaughtering these animals due to the problems this is going to cause in the plant in segregation and disposal of the product."
The new SRM rules, which will effectively ban this material from the animal food chain, will go into effect in July. But the rendering and processing sectors are already positioning themselves well ahead of the deadline to ensure compliance with the new regime of regulations.
Cargill's new discount will go into effect on May 14 and Jim Clark at the Ontario Cattle Feeders Association says it's likely the way of the future. Clark, the association's general manager, said the costs of the new SRM rules will likely fall back to the beef producer.
"Everyone is trying to figure out what the true costs are going to be from these rules. We haven't seen all the fallout yet."
Clark said other packers have not said very much yet on the issue but it is clear no one wants mature cattle on their hands. Producers who have aged cattle were already being dinged with discounts and Clark said the situation is likely to get worse.
The rule change will also have a big impact on sale barns which have live fed cattle sales. With the packers trying to steer clear of mature cattle, the sale barns will have to be vigilant about the age of fed cattle going through the ring.
"We're going to have to check all the live cattle. It's terrible," said Len Gamble of Brussels Livestock. "We're going backwards here."
Gamble said running 700-900 large finished cattle through a chute on sale day to check their teeth is going to be "a lot of work" and no one is going to pay him to do it.
He said they have been running up to half of the live cattle sold at Brussels through the chute already but starting this week all of them will have to be checked.
The SRM regulations are also likely to have an impact on provincially inspected processing plants. Many of those smaller plants already rely on older animals for much of their business and the cost of disposing of SRM material could mean many will stop slaughtering them.
Clark said if and when the border opens to older animals more cattle will be shipped south to the U.S. for slaughter as a result of the new regulations. Packers in the U.S. have yet to have the same rules imposed on them as are now being implemented in Canada and Clark said this leaves Canada at a disadvantage.
"The question is will we see more of the processing sector go out of business in Ontario and Alberta?"
meatpoultry.com